It's July 18, 1937, and Adolf Hitler and the National Socialists are propagandizing about art. The grandiose House of German Art has officially opened in Munich, with an inaugural exhibit of state-sanctioned works labeled "Great German Art Exhibition." The following day an opposing show opened next door, this one labeled "Degenerate Art" ("Entartete Kunst") and taking aim at the modern aesthetic.

"Degenerate Art" was a three-year traveling exhibition that toured Germany and Austria, attracting some two million viewers in Munich alone. Infamously showcasing avant-garde works that were seized from German museums and private collections, it was reportedly the most popular traveling show of all time.

In Munich, the exhibit was housed in the less-than-splendid Hofgarten arcades, with works crowded together and mocked with derisive labels and commentary. Of the 112 "degenerates" whose works were demonized, only a handful were Jewish. But the campaign against them was part of the Nazi campaign against everything perceived as "un-German" and "Jewish-Bolshevik".

Expressionism, Cubism, Dada and the Bauhaus were maligned and contrasted unfavorably with the classically inspired, idealized works so revered by Hitler and on display at his new art palace. A snapshot (though not a literal one) of the competing exhibits can now be seen on the third floor of Neue Galerie, where the two visions face-off in one gallery room, a highlight of Degenerate Art: The Attack on Modern Art in Nazi Germany, 1937, a fascinating historical show that runs until June 30. It neatly coincides with the release of The Monuments Men, George Clooney's film about efforts to recover stolen art treasures during the Second World War.

Dedicated to presenting the art of Germany and Austria, Neue Galerie has brought together some 50 paintings and sculptures and more than 30 works on paper (including propaganda posters), a number from the original exhibit in Munich. Blow-ups of period photographs-such as that of Hitler and Nazi officers inspecting "degenerate" works in Berlin in 1938, or the train station at Auschwitz/Birkenau in 1944, flooded with the damned-provide chilling context.

An estimated 20,000 works were confiscated during the Nazi regime. Some were destroyed-around 5,000 were burned at a fire station in Berlin in 1939-and some were sold for foreign currency or exchanged for "more acceptable" art. (Triumphant footnote: Some were later re-acquired by museums and collectors).

But many pieces are still missing, a fact that we are reminded of in the second floor gallery room, where the walls are littered with empty frames with labels detailing the missing paintings ("Paul Klee, Winter Garden, 1925"). The symbolism could not be plainer.

Many of the artists featured in the 1937 "degenerate" show, and on exhibit here, will be unfamiliar to an American lay audience. But fans of New York's Museum of Modern Art will undoubtedly recognize Max Beckmann's dramatic triptych, Departure (1932-35), displayed here as a representative piece of "inferior" art, with panels depicting acts of torture and barbarism flanking a central panel of a serene family in a departing boat, a symbol of freedom.

To the left, there is another triptych, this one an officially approved painting, The Four Elements (1937), by Adolf Ziegler. Hitler owned it and was so fond of it that he hung it over his fireplace. The figures depicted are fair-haired, leggy, racially approved nudes, stand-ins for fire, earth, water, and air.

This room, a study in contrasts and the crux of the show, boasts several other riveting works on the "degenerate" side, including sculptures by Ernst Barlach (The Berserker, 1910), Karel Niestrath (Hungry Girl, 1925) and Wilhelm Lehmbruck (Head of a Thinker, 1918)-the last one a modern take on Rodin's The Thinker.

Other exhibit highlights:

--a ledger that lists works confiscated from public institutions in Germany between 1937-38

--a side gallery with watercolors by Emil Nolde, a member of the Nazi party whose works were nonetheless vilified

--a trio of watercolors by Paul Klee

--Ernst Ludwig Kirchner's Berlin Street Scene (1913-14)

The show is replete with grim tales of artists whose lives were shattered by the Nazi purge. Some stayed in Germany, but were driven underground, some were forced into exile, and some like Ernst Ludwig Kirchner resorted to suicide. Others like Oskar Kokoschka expressed their defiance by painting their portraits. His title: Self-Portrait as a Degenerate Artist, 1937.